Bumps in the road for the city's Grand Prix race

Organizers seeking title sponsor, debating fix for Light Rail tracks

In this July 4, 2010 file photo, Will Power (12), of Australia,… (David Boe, Associated Press )

October 23, 2010|By Julie Scharper, The Baltimore Sun

Heart-pounding turns, surprising twists and edge-of-your-seat drama draw fans to the brand of high-speed automobile racing that will transform the streets of Baltimore in less than a year.

But as the inaugural Baltimore Grand Prix looms closer, it appears the lead-up to the event could be just as much of a nail-biter.

With the three-day racing festival just 10 months away, organizers have yet to land a title sponsor to help shoulder the cost of promotion. A set of light rail tracks is posing an apparently unprecedented challenge for engineers. And a lukewarm climate for Indy-style racing only adds to the uncertainty.

The team of local businessmen and lawyers staging the event is banking on tens of thousands of fans flocking to downtown Baltimore for a festival to span next Labor Day weekend. They say fans will pump tens of millions of dollars into the local economy, and the city will shine in media coverage as a picturesque backdrop for the whizzing open-wheeled cars.

The group has won over the city's elected leaders, who have pledged $7.75 million for road work and infrastructure repairs for the course.

But before the green flag may wave, millions more must be invested in miles of barriers and fences, grandstands and skyboxes, sanctioning fees and advertising campaigns in several markets. That's where corporate sponsors — and their deep pockets — play a key role.

"A title sponsor can make or break your event," said Speed Channel columnist Robin Miller, who has covered racing for four decades. Typically, the sponsor pays for print and broadcast ads and billboards in exchange for prominent placement of its name.

"Ten months out and they don't have a title sponsor?," Miller asked. "They've got to be nervous."

Sponsorships, which play an increasingly influential role in professional sport, are particularly crucial in racing. Drivers, teams and races all rely on corporate dollars to keep the intricately engineered and expensive-to-run cars on the tracks.

The decisions of sponsors in recent months to back away from two of Indy racing's most prominent drivers, Tony Kanaan and Ryan Hunter-Reay, have fueled fears that money for the sport is drying up, Miller said.

Event promoter Jay Davidson is confident his team can hook the right sponsors. Davidson, the president of Baltimore Racing Development, said the group is "negotiating hard with three different companies, and one of those companies will wind up being our title sponsor."

Davidson said legal agreements preclude him from naming the companies, but two are based in Maryland and one is from the surrounding region. He said he expects to announce a title sponsor in the next few weeks who will pay "in the low seven figures."

Baltimore Racing Development is trying to line up a separate sponsor for the American Le Mans Series race planned for the day before the Indy race.

Once the main sponsors have been nailed down, Davidson says, the group intends to sell as many as 20 smaller sponsorships for price tags ranging from $25,000 to $250,000.

"We've sort of taken a top-down approach to this, so we don't preclude anything from our title sponsor," he said.

Davidson says that he expects to announce sponsorship deals this week with the five hotels near the course: the Marriott, Harbor Court, Sheraton, InterContinental and Hilton.

"We're trying to give sponsors signage that is very clear and that will show up well on television, so that it won't be cluttered like some races," Davidson said. And the group organizers have the latitude to strike new deals up until just a few weeks before the race, he said.

But it's unclear how potential sponsors will respond to a race in Baltimore. Because it's the first year of the event, there are no guarantees on attendance or viewership.

Davidson said the Le Mans race will likely be broadcast on either CBS or the Speed Channel, and Sunday's Indy race will be aired on Versus. Versus, which airs the majority of the 17 races in the Indy series, draws about 300,000 viewers per broadcast, Miller said.

The Baltimore race will also be aired internationally. In subsequent years, Davidson said, it could be shown on ABC in this country.

Lee Igel, a professor of the business of sports at New York University, says the slumping economy makes sponsorship a harder sell. If profits are flagging, he says, it's tough to persuade shareholders to spend cash promoting a sporting event. And it's difficult to gauge the value of plastering a company's name on an event.

"There's no reliable metric on return on investment in sports sponsorships," Igel said. "You get lots of vanity plays and perks, but no one is quite sure how that turns into profits."

Igel says most new sporting events, teams and venues are unveiled with sponsorships already in place.